4.

Which of the following is true about the difference between coupon rate and yield?

Select one:

a. the coupon rate is the bond's annual interest payment as a percentage of par value, the yield is the market's required return on the bond.

b. the yield on a bond never changes, but the coupon rate changes with market forces.

c. the coupon rate is not relevant to the bond value, but the yield is.

d. the coupon and yield can never be equal.

5.

A bond has a coupon rate of 10% and a yield of 10%. Which of the following is true about the bond's price?

Select one:

a. the price will be equal to $1000

b. the price will be greater than $1000

c. the price will be less than $1000

d. not enough information to determine

6.

Which of the following bonds will sell for less than $1000?

Select one:

a. A bond with a coupon of 4% and a yield of 4%.

b. A bond with a coupon of 5% and a yield of 4%

c. not enough information to determine

d. A bond with a coupon of 4% and a yield of 5%